The UK’s trade deficit widened by £600 million in November from the previous month, bringing it to £4.5 billion, the Office for National Statistics reports (ONS).
The figures provide damning evidence contrary to the notion that a weakened pound is industry’s saving grace by fuelling exports. At one per cent cheaper than in October, goods sent abroad fell by £1.2 billion, bringing its deficit to £8.3 billion. A trade surplus on services of £3.9 billion was insufficient to counteract the demise. In terms of volume, exports were seven per cent down, though that figure excludes oil.
The deficit with EU countries was £3 billion while with the rest of the world it was £5.3 billion. There were falls in exports of oil, chemicals, aircraft, cars, semi-manufactured goods other than chemicals, and basic materials. Britain appeared to tighten its purse strings in terms of luxury items; imports of precious stones, oil and consumer goods other than cars all fell.
Commenting on today’s ONS release, Lee Hopley, senior economist at the EEF, told the Manufacturer: “Clearly the recent falls in sterling haven’t been enough to provide any kind of significant boost to UK industry in terms of exports.”
“If there is no demand, good conditions for sterling can only do so much to help. The economic crisis is a global situation with demand weakened in some places and completely fallen off in others and that’s clearly behind this bad news today.”